Where to Find Dividend Stocks for Your Portfolio

This post provides various dividend lists and recommendations on where to start looking to find potentially great dividend stocks for your dividend portfolio. Whether you're just starting with dividends or looking to improve your current portfolio, this information should help you uncover more dividend stocks to add to your portfolio.

Dividend Kings

Dividend Kings are companies that have increased their dividends for 50 or more consecutive years. These companies demonstrate exceptional business stability through multiple economic cycles, recessions, and market downturns.

The S&P Dividend Monarchs Index (SPHYDMUP) tracks these rare dividend payers. Dividend Kings typically operate in mature industries with steady cash flows and maintain conservative balance sheets. Many are household names with established brands and customer loyalty built over generations.

For income-focused investors, Dividend Kings represent some of the most reliable dividend stocks available, though their current yields might not always be the highest.

Dividend Aristocrat List

Dividend Aristocrats are S&P 500 companies that have increased their dividend payments for 25 or more consecutive years. To be included in this list, companies must have a market value of at least $3 billion and average daily trading volume of at least $5 million over the previous three months.

The S&P 500 Dividend Aristocrats ETF (NOBL) holds all ~70 dividend aristocrat companies and can be compared to the S&P 500 Index (SPX):

S&P Dow Jones Indices tracks these companies through an equal-weighted index, which has shown better long-term results than the S&P 500 Index. According to S&P Dow Jones Indices, from January 2004 to July 2023, Dividend Aristocrats beat the S&P 500 by an average of 0.55% per year. They achieved this with lower risk (market beta of 0.8) from December 1989 to July 2023.

These companies also showed stronger performance during market declines, beating the S&P 500 in 69.34% of down months. When markets were up, they still outperformed in 43.61% of those months.

Dividend Aristocrats likely outperform for three main reasons:

1. Strong financial health: Companies that consistently raise dividends typically generate strong earnings and cash flow to support these payments.
2. Better capital allocation: Since these companies commit to paying dividends, they must be more selective about how they invest their remaining earnings. This discipline often leads to smarter business decisions.
3. Competitive advantages: To maintain increasing dividends for 25+ years, companies usually have some form of economic moat that helps them succeed over time.

Investors can access all Dividend Aristocrats through the NOBL ETF or by purchasing individual stocks from the list. Many of these companies will likely continue growing their dividends for decades to come. However, prioritize investing in companies with dividend payout ratios below 75%, as this indicates the company still has room to grow its dividends in the future.

Nasdaq Dividend Achievers Index

The NASDAQ Dividend Achievers Index tracks 400+ companies that have increased their dividends for at least 10 consecutive years. Companies must be members of the NASDAQ US Benchmark Index and meet minimum capitalization and liquidity requirements to qualify for this list.

The NASDAQ US Broad Dividend Achievers Index (DAA) can be compared to the S&P 500 Index (SPX):

While Dividend Aristocrats are often the first choice for dividend investors, many excellent dividend stocks on the Dividend Achievers Index deserve consideration for your portfolio. These companies typically offer attractive yields and strong growth prospects, and may eventually join the Dividend Aristocrats Index as they continue extending their streak of annual dividend increases.

Dividend Champions, Challengers, and Contenders

The Dividend Champions List tracks companies that have raised their dividends for 25 consecutive years, similar to the S&P Dividend Aristocrats Index. Originally compiled by David Fish, who passed away in 2018, this list is now regularly updated by the dividend investing community.

While the Dividend Aristocrats only includes S&P 500 companies meeting specific market cap and liquidity requirements, the Dividend Champions List covers all U.S. companies regardless of size or trading volume. This provides investors with a broader universe of dividend-growing stocks to consider.

As of 2024, there were 140+ companies on the Dividend Champions list, more than double the number on the Dividend Aristocrats list.

David Fish also created two additional lists to track companies with shorter dividend growth streaks:

• Dividend Challengers: Companies that have raised their dividends for 5-9 consecutive years.
• Dividend Contenders: Companies with 10-24 years of consecutive dividend increases.

These additional lists help investors identify companies that are building their dividend growth records but haven't yet reached Champion status.

Dow Jones Industrial Average (DJIA)

The Dow Jones Industrial Average (DJIA) is one of the most watched stock indexes, and is considered a proxy for general market conditions in the U.S.

It's worthwhile to look at the DJIA because the majority of its 30 blue-chip companies are large, established dividend-paying businesses. These companies cover nearly every major industry in the U.S. stock market.

The DJIA Index (DJIA) is compared to the S&P 500 Index (SPX) below:

The DJIA is a great place to start, especially for new dividend investors. Investors can also consider DJIA stocks during uncertain economic times, as weaker companies tend to be replaced during downturns.

Media Sources, Websites, and Newspapers

Various media sources, websites, and newspapers that discuss dividend stocks can help you find many possible dividend investments.

Here's a short list of useful resources:

• Yahoo Finance: If you search for a dividend stock, you'll see a section called "People Also Watch" under the "Summary" tab which typically shows other dividend stocks.
• Seeking Alpha: Dividend investors write many articles here on different dividend stocks.
• YouTube videos and blogs: These can reveal many "hot" dividend stocks that might be worth looking into further.
• Dividend forums: Reddit and other dividend or value-oriented forums discuss dividend stocks.
• Dividend newsletters: The free newsletter from Dividend.com can be useful to find new dividend stock ideas.
• Business Standard: Features dividend-related news for publicly traded companies.

There are many other ways to find dividend stocks, but the list above should help you get started.

The Bottom Line

While these lists offer good starting points for your research, don't buy these dividend stocks simply because they appear on the dividend lists covered in this article. For instance, many companies in the Dividend Kings and Aristocrats actually have lower yields than the S&P 500.

None of these lists require a minimum dividend yield or minimum annual growth rate. Some companies also may only raise their dividends by small amounts each year just to maintain their status.

Therefore, use these dividend lists to identify potential investments, but always ensure any dividend stock you consider meets your own investment criteria as well.